How To Secure Your Shopify Store Against Fraud

They are always out there.

No matter what you do in life, there are people looking to scam you and take your money.

Online stores make for a juicy target.

That’s why you need to know how to secure your Shopify store against fraud.

Luckily, Shopify takes care of much of the work for you.

But there are still a few things you need to handle yourself. Keep reading to learn what you should be doing to protect yourself from being defrauded.

 

How To Secure Your Shopify Store Against Fraud

There are several ways to secure your Shopify store against fraud. First, Shopify is a reliable e-commerce platform that comes with many built-in fraud prevention tools and features.

In addition, you can limit your staff’s access to information, and use multi-step authentication and passkeys for additional protection. You can also train your employees, layer up security, and add suspicious activity alerts on the store.

Finally, there are a number of chargeback insurance providers that take a percentage of your proceeds from every order as payment to insurer the order against chargebacks. If the order ends up being fraudulent, the insurance provider reimburses you the money you lost.

Let’s take a closer look at the most important ways you can secure your Shopify store against fraud. Before anything else, you need to understand the different kinds of fraud to which an online store is exposed.

 

Understand The Different Kinds Of E-commerce Fraud

As a Shopify merchant, you need to be aware of the different ways in which criminals commit fraudulent activities. These include the following.

• Credit card fraud: Criminals often use stolen cards to shop in e-commerce stores.
• Chargeback fraud: Dishonest consumers try to dispute legitimate transactions. This can result in a loss of revenue for your store, since you need to refund the  amount in question (and you usually won’t get the product back).
• Phishing: Criminals may trick you or someone on your team into revealing your Shopify store account details and use that info to steal from you.
• Brute force attacks: Criminals may hack into a Shopify account by guessing the password.
• Shipping fraud: Hackers or fraudsters may change shipping details to receive goods.

Understanding and being aware of these types of fraud is important, in order to be able to prevent them.

 

Make Security Checks from Time To Time

As a Shopify merchant, you can easily check who has access to which page on your Shopify stores. To do this, simply visit the Team Page and set each member’s access level.

You can also view which member has what level of access on the Store Detail page. Make these checks regularly and modify the access levels or revoke them as needed.

 

Avoid Giving Your Login Credentials

Giving away login credentials is the worst mistake Shopify merchants make that can compromise their Shopify account’s security. Please avoid this at all costs.

As stated in the point above, you can restrict your team member’s access to your store. You can also create partner accounts and use the collaborator access features to limit the parts of the store they can access.

 

Use Reliable Anti-Virus Software

Anti-virus software detects and quarantines malicious code and malware, preventing it from attacking your device. This can prevent threat vectors from stealing your confidential information, credit card details, login credentials, etc.

 

Always Look For HTTPS In The Website URLs You Browse

The ‘S’ in HTTPS stands for SSL encryption and it secures data transfer between the website and the web browser. This is very important to protect your sensitive information like credit card details, passwords, etc.

Without HTTPS, you are making any data passed insecure and vulnerable to attackers that steal data. If you use your device to browse through various websites, avoid ones without the HTTPS.

 

Fortify Your Shopify Security With A Strong Password

Always use a strong password with upper and lower-case letters, numbers, and special characters in it. Avoid using birth dates, pet names, kids’ names, etc. Those are easy to hack. You can also keep changing the account password regularly.

Also, use two-step authentication that requires special verification passcodes or OTPs you receive on your email or phone. Make sure no one has access to your phone and email in such a case. This can enhance your store’s security even if someone were to obtain your password.

Use Passkey Feature

Passkeys are a great way to further secure your Shopify account. They eliminate the need to enter a password. Instead, you can use biometrics, a PIN, or a pattern which hackers cannot know. The best part is you can create the passkey on your mobile device to use on your laptop and vice-versa.

 

Always Use Secure Connection For Browsing

Avoid using public Wi-Fi to access your account. Sometimes, hackers create a hotspot with a name similar to the public wi-fi. The moment you connect to it, they can access all your information. This can compromise all your online accounts including the Shopify account.

 

Use Additional Fraud Prevention Apps

Shopify already has many built-in tools and features for preventing fraud. You can, additionally, visit the Shopify App Store to install apps like Fraud Filter.

This app helps you create custom filters that are tailored for your business. The orders that match these filters get flagged. It also prevents certain known customers from placing orders.

I once had the same customer place numerous orders. They were all fraudulent (he or she used a stolen credit card). If had an app like this, I could have blacklisted this customer and prevented him or her from placing additional orders in the future.

As it was, I would have been on the hook for about $10,000. Luckily, I had another kind of fraud protection app.

This kind of app basically functions as chargeback insurance. If your store gets hit with a chargeback because someone made a purchase with a stolen credit card, this provider covers the amount of the chargeback.

The app I used was Clearsale. I started out with Riskified, which is one of the largest and most popular, but I found Clearsale better for my store. They approved orders (these app all have to approve each order before you are free to ship it) faster, and they declined fewer orders overall.

Other useful apps and tools for preventing fraud on Shopify include the following:

• Fraud Analysis: this helps you identify risky orders
• Shopify Control: this creates a dashboard that lets you view potential fraud and other related analytics.
• Shopify Flow: this security tool lets you automate the entire order process while also letting you allow or block orders your store can or cannot accept

 

Backup Your Data

You should regularly back up your Shopify store data on a separate server in case of a hardware or software data failure, which could occur due to malware, viruses, human errors, etc.

Backups can help you prevent monetary losses. Also, backing up on a separate server can help protect the data from being hacked.

 

Stay Up-To-Date

As technology advances, so do unscrupulous people and fraudsters who try to trick and steal from others. They are constantly coming up with new ways to commit fraud.

To keep your Shopify store safe, you need to keep yourself up-to-date with the latest tricks scammers use and the best ways to protect your business from them.

Watch out for signs that something might be wrong and understand the security tools that can keep your Shopify store safe. If you know about the dangers, you can stay abreast of things and protect your store from online dangers.

 

Does Shopify Protect Against Fraud?

Yes, Shopify has many tools and features to protect merchants from fraud. This includes:

• Fraud analysis: This tool decides which orders to fulfill based on risk assessment and insights.
• Shopify Protect: This is available for US-based Shopify shops that use Shop Pay. It can protect eligible orders against fraudulent and unrecognized chargebacks.
• Shopify Flow: This tool lets you automate the entire order process while also letting you allow or block orders your store can or cannot accept.
• Dynamic 3DS: Available for all Shopify payments. Helps prevent credit card fraud at checkout.
• Proxy detection: Flags certain IP addresses
• Payment Capture Control: This is for stores that do not use Shopify Payments. It helps you become aware of third-party transaction fees.

 

How Does Shopify Determine Fraud?

Shopify uses machine learning algorithms (for tracking and analyzing transaction patterns, login attempts, and other user actions) to provide potential fraud-risk recommendations. The constantly evolving tool uses past transactions to detect potential fraud.

These recommendations offer the advantage of accumulated years of expertise in fraud detection. Shopify consistently enhances these algorithms for an accurate identification of fraudulent orders.

 

Does Shopify Have Buyer Protection?

Yes, but not in the traditional sense. The platform utilizes the Shopify Payments feature to protect buyers when they pay for your products.

However, the rules regarding buyer protection can vary based on how the buyer pays and also the rules you (the merchant) have established.

From a buyer’s perspective, it is a good idea to check these rules regarding payment methods and know the policies of the merchant, in order to get an idea of know how much protection you can get as a buyer.

 

Secure Your Shopify Store: Final Thoughts

Shopify has many built-in features to help secure your store against fraud. In most niches, those features, along with your own common sense, are enough to keep fraud at bay.

But there are also additional apps you can get for more protection. As mentioned, I used Clearsale (I started with Riskified), to insure every order against chargebacks.

The company took a small percentage of the revenue from the order (I think it was 0.6%). In return, they paid for any chargebacks I incurred.

Overall, I spent more on this service than they paid out, so I guess it wasn’t worth it in terms of money.

However, I continued to use their service for the peace of mind it offered. I would have stressed a lot on large orders, never knowing if it could end up being fraudulent and leaving me on the hook for a huge amount of money.